The Quick Read: Fannie Mae is lining up with Freddie Mac so servicers can reach out to borrowers who may qualify to drop private mortgage insurance (PMI). That is outreach, not automatic cancellation, and there is no start date yet. I’m writing this as of September 28, 2026, a week after rates pushed above 7% in Freddie Mac’s survey. For many low-down-payment owners with fresh equity, checking PMI is the cheaper first move before any refinance talk.
Key Takeaways
- FHFA Director Bill Pulte said on September 15 that Fannie Mae will align with Freddie Mac on servicer outreach about PMI cancellation.
- Outreach is not cancellation. Eligibility, payment-history and valuation rules still apply.
- No implementation date and no savings estimate have been given, and it is unclear whether servicers must make the calls.
- Rates have risen every week this month, and refinance applications are at their slowest pace since early 2025.
- Dropping PMI needs no new loan and no new rate. You can start asking now.
What Changed: The Dated Facts
Here is the short version. On September 15, 2026, Pulte said Fannie Mae will follow Freddie Mac’s lead. HousingWire reported that Freddie already lets servicers contact borrowers who may qualify to cancel PMI. Fannie will update its Servicing Guide to match.
A servicer is the company that collects your monthly payment and handles your account. It may or may not be the company that made the loan.
Why does this matter? Today’s Fannie guide is lopsided. A law-firm note dated September 24 says servicers can contact borrowers nearing termination based on the home’s original value. They are barred from soliciting cancellation based on current value. That bar is the piece this change targets.
The Homeowners Protection Act of 1998 ties automatic termination to the original home value and the amortization schedule. It does not count appreciation. HousingWire notes that counting price gains is a discretionary area for the two agencies. So the agencies have room to act, and this is how they chose to use it.
Then the caveats. Homes.com reported on September 15 that Pulte gave no implementation date and no savings estimate. It also said it is unclear whether servicers would be required to make the calls. A Fannie Mae spokesperson said the company looks forward to working with FHFA to extend outreach to borrowers whose homes have appreciated.
Scale is the other open question. Yahoo Finance reported that about 800,000 borrowers used PMI to buy homes last year. The mortgage insurers’ trade group said premium rates are down 25% or more since 2017, per National Mortgage News on September 15. The same story quoted a KBW analyst who expects modest consumer uptake. I read that as a sober forecast, not a dismissal. These specifics are subject to lender guidelines and a full review of property, leverage, and credit.
No source in my research says how many borrowers pay PMI today or how many could cancel. Anyone quoting that number is guessing.
Why Is Everyone Talking About This Now?
Because the usual escape hatch is shut. Rates have moved the wrong way, and fast enough that the move itself is the news.
Freddie Mac’s survey put the 30-year fixed at 7.03% for the week of September 24, up from 6.95% the week before. That was the first reading above 7% since January 2025, per Fox Business. The prior week’s jump was 19 basis points. Realtor.com’s senior economist called it the largest one-week move since April 2025, also.
The weekly path on FRED shows it plainly. The Freddie Mac average was 6.71% on September 3, then 6.76%, then 6.95%, then 7.03%. That is a 32 basis point climb in three weeks.
Two things sit behind it. First, the Fed. On September 16 the FOMC raised its target range 25 basis points, to 3-3/4 to 4 percent. CNBC reported a unanimous 12-0 vote and the first hike since 2023.
Second, the housing market itself. The MBA’s survey for the week ending September 18 put its contract 30-year rate at 7.12%, the highest since May 2024. Refinance applications fell 3% that week and sat 62% below a year earlier. The MBA called the refinance pace the slowest since February 2025.
Here is a caution on reading those rate numbers. Freddie Mac’s own release says its survey covers conforming purchase loans for borrowers with a large down payment and excellent credit. That is not the typical PMI payer. The headline number is a market gauge, not what a PMI borrower should expect to see. I won’t pretend otherwise, and I won’t quote you a rate here.
What It Means for Homeowners With Equity
Start with the equity itself. It is large in aggregate. ICE’s Mortgage Monitor, released in early August, put mortgage-holder equity at a record $18 trillion. It said 47.5 million borrowers held $11.7 trillion in tappable equity. That release is a bit older than my other sources, so treat it as background.
Aggregate equity says nothing about your loan. It does not tell you whether you can drop PMI. It just means the raw material, home value above what you owe, is more common than it was a few years ago.
Prices are still rising, though slowly. NAR’s August report, published September 10, put the median existing-home price at $429,100. That is up 1.6% on the year and the 38th straight year-on-year gain. According to the same NAR report, sales ran at a 3.98 million annual rate, down 2.0% on the month. Inventory reached 1.62 million units, a 4.9-month supply. NAR’s chief economist said months’ supply was the highest in more than ten years.
Pending sales, reported September 17, rose 0.3% on the month and fell 4.7% on the year. Price growth that slow has a consequence. Equity built through appreciation is getting harder to add. If you bought in the last few years with a small down payment, your gain may already be in hand. Waiting for more is a bet.
Here is the practical split.
| Question | PMI cancellation | Rate-and-term refinance |
|---|---|---|
| New loan needed? | No | Yes |
| New rate applies? | No | Yes |
| Affected by this month’s rate jump? | No | Yes |
| Depends on servicer rules? | Yes | Less so |
That table is the whole point of this column. Cancelling PMI and refinancing are two different tools. Rising rates close one of them for many borrowers. They do not touch the other.
My Take
I think this is a good change that will be oversold.
It is good because the old rule made little sense. A servicer could see that a home had appreciated and could not say a word about it. A borrower who did not know the rules kept paying. Letting servicers speak first fixes an information gap.
It will be oversold for three reasons.
It is outreach. Nothing cancels itself. The agencies have not changed the eligibility rules, the payment-history rules or the valuation rules, per WRE News and the law-firm note above. A call is an invitation to start a process, not a result.
It has no start date. Until the Servicing Guide changes, I would not wait by the phone. And as Homes.com notes, nobody has said servicers must call.
The savings are unknown. The sources give no estimate, and I won’t invent one. PMI is a real monthly cost for the borrowers who carry it. But how much it saves you depends on your loan, and the sources I have don’t say.
Honestly, the bigger story may be the timing. Rates are at a multi-year high, and refinance is shut for many borrowers. The agencies are pointing at a cost cut that needs no new loan. That is a sensible thing to do in a month like this. Whether it moves many files, I can’t tell you. The KBW analyst quoted by National Mortgage News thinks uptake will be modest. I would not bet against that.
What I’d Do Now
Don’t wait for a call. Treat this as a checklist.
1. Find out who owns your loan. The change is about Fannie Mae and Freddie Mac loans. If your loan sits elsewhere, other rules apply. Your servicer can tell you, and your statement or online account may show it.
2. Confirm that what you pay is PMI. Loan type matters. Not every mortgage insurance charge works the same way. Read your statement line by line.
3. Ask for the cancellation requirements in writing. Ask what the servicer needs to see on payment history. Ask what valuation method it accepts and who pays for it. Ask whether it will consider current value or only the original value. That last answer is the one this policy may change.
4. Gauge your home’s value honestly. NAR’s median is a national figure. It is not your street. If your value is borderline, wait for better evidence than a listing site guess.
5. Keep refinance as a separate question. If you are also looking at a cash-out or a rate-and-term move, look at our loan options page for how the programs work and where to find current guidelines. Qualification is subject to lender guidelines, credit review and property review.
On rate mechanics, if you do decide to refinance, understand what a lock is. It holds a rate for you for an agreed period. Quotes gathered on different days are not comparable. The market has moved this much in a month. A hypothetical makes the point: if a rate moves from 6.5% to 7.5%, the difference is a full point. So when you compare, compare on the same day and the same terms. If you like what you see and your deal is real, lock it. Floating in a market like this one is a bet on direction, and I don’t make that bet for anyone.
For owners who also hold a rental, our DSCR loans guide explains how investor loans qualify on the property’s rent rather than on personal income documents. It is a different product for a different goal, but equity in a rental is part of the same picture.
Should You Wait for Rates to Fall First?
No. Waiting for lower rates is a plan for a refinance, not for PMI.
Dropping PMI does not involve a new rate at all. So the case for waiting does not apply. If you qualify, every month you wait is another month of a charge you may not owe.
The rate outlook is genuinely uncertain, so I would not build a plan on a prediction either. Wells Fargo Advisors’ summary of the Fed meeting cautions that further hikes are not an automatic series. The dot plot points to another 25 basis point hike by year-end, per that summary. Markets price at least one more. Nobody knows. Don’t plan around a guess.
Questions I Would Ask Before Trusting a Call
A servicer’s outreach is a sales-adjacent contact even when it is well meant. A few sanity checks apply.
- Is the caller identifying your actual loan details, or reading a script?
- Are you being asked to pay for something up front, such as a valuation?
- Is a refinance being pitched under the banner of PMI removal? That is a different product.
- Is anything promised in writing, or only on the phone?
I’m not suggesting bad faith. Most servicers will handle this by the book. But a borrower who asks for requirements in writing is in a stronger spot than one who agrees to a call. If you don’t recognize the number, call your servicer back on the number printed on your statement.
If you are weighing a purchase or a refinance this fall, Lendmire can walk you through how the current programs fit your file.
Frequently Asked Questions
Will my servicer call me about dropping PMI?
Maybe, but not yet. Fannie Mae has said it will align with Freddie Mac, and Freddie already allows servicer outreach. There is no implementation date. Homes.com reports it is unclear whether servicers must make the calls. Until then, contact your servicer yourself.
Does PMI now cancel automatically?
No. The change allows outreach. It does not change eligibility, payment-history or valuation rules. The Homeowners Protection Act’s automatic termination is generally tied to the original home value and the amortization schedule, not to appreciation. You still need to start the process.
Do I need to refinance to drop PMI?
No. Cancelling PMI does not involve a new loan or a new rate. That matters this month, since refinance applications are at their slowest pace since early 2025. Refinancing is a separate decision with separate costs.
Does record home equity mean I can drop PMI?
Not necessarily. The $18 trillion figure from ICE is aggregate equity across all mortgage holders. It says nothing about any one loan. Your eligibility depends on your loan type, your servicer’s rules, your payment history and your home’s value.
How much would I save?
No source gives a savings estimate, and I won’t guess. The size of your PMI charge depends on your loan. Your monthly statement shows what you pay today.
About Lendmire
Lendmire, NMLS# 2371349, is a mortgage broker with two platforms: DSCR investor lending across 41 markets, including Washington, D.C., and consumer mortgage programs in 16 states, all arranged through wholesale lending partners. This column is written by Lendmire’s founder and reflects the market as of its publication date; program terms and availability are set by the lender on each file. Scotsman Guide named Lendmire a Top Mortgage Workplace in both 2025 and 2026.
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References
4. Freddie Mac: weekly mortgage rate survey release (September 24, 2026)
5. Fox Business: mortgage rates, September 24, 2026
6. Federal Reserve: implementation note (September 16, 2026)
7. CNBC: Fed rate decision (September 16, 2026)
8. MBA Weekly Applications Survey (September 23, 2026)
9. NAR: existing-home sales report for August (September 10, 2026)
10. WRE News: Fannie Mae PMI cancellation proactive servicer outreach (September 15, 2026)
11. Wells Fargo Advisors: FOMC summary (September 16, 2026)
This article is part of Lendmire’s Mortgage News series — every loan program’s qualification details, guidelines, and scenarios live on the loan options page.
Related reading: Why A Local Real Estate Broker Matters As Buyers Gain Leverage, September 2026? · September 2026: Buyers Need A Real Estate Agent As Supply Grows, Rates Climb · Listing Your Home For Sale This Fall As Inventory Climbs And Rates Rise
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Disclosure information. Lendmire is a state-licensed mortgage brokerage under NMLS# 2371349. Lendmire is not a depository institution, direct lender, or financial advisor — all loans referenced are placed through wholesale lender partners and are subject to each lender's underwriting standards. This article is provided for general informational purposes and is not a commitment to lend, nor does it constitute financial, legal, or tax advice. Loan programs, terms, rates, and qualification standards change without notice and depend on borrower profile, property type, and the state in which the subject property is located. Equal Housing Opportunity provider. NMLS Consumer Access: nmlsconsumeraccess.org.